Supply is also tight in the new-home market

The silver lining in this frustrating sales cloud is that low supply coupled with rising demand equals rising prices. Year over year, the median price is up a very stout 11.8%, which is on par with the boom days of 2005. (So we shouldn’t expect the current price trend to hold indefinitely).

New-home sales also appear to be going nowhere fast. That said, they are at least lurching forward. New-home sales rose 1.5% to an annual rate of 417,000 units in March. Unfortunately, the increase was still 2,000 units short of what most economists had expected.

Supply is also tight in the new-home market. The number of new homes for sale rose by 3,000 units for March, but that wasn’t enough to materially increase inventory, which remains at a low 4.4-months supply at the going sales pace.

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